Apr 14, 2023

Ether continues outperforming bitcoin following the Ethereum network’s Shanghai upgrade, which has proven bullish for much of the cryptocurrency market.

Video transcript

Are you getting a little nostalgic for the altitudes we're seeing in crypto? Well, so am I and here we are now joining us now to discuss the crypto markets is Dexterity capital managing partner, Michael Sahai. Welcome Michael. Hey, thanks for having me on again. I'm glad to see you again. So Ether is above 2000 playing around the 2100 mark. Even what happened, what happened to the Chappelle selloff? There was supposed to be a Chappelle selloff. We never saw it. We got a rally. Why did you know? Oh, well, you know what I think it was is we've seen these kind of things before where Laberge, for example, happened last year and everyone was kind of sitting on the sidelines in the hours and days before it happened and after and once it all was all clear, everyone got back into the market, we saw Bitcoin take off during that period of quiet while Chappelle was happening and as soon as everyone felt safe again, they just got up, it was just lagging behind the BT C price. So that's why we're seeing a rally when we might have expected otherwise. Yeah, you know, we're also seeing uh uh in the, in the derivatives markets. We're seeing options in ether uh I taking off and in some cases, actually, it looks like in 2023. Uh according to Levi, we, we have basically um more trading in ether options than we do in Bitcoin options. What does that tell you, tell us first of all about where the market wants to see uh some of that volatility and some of the trading action, are we going to see more of it happen in big in E or do you think that ultimately it will go back to Bitcoin as that goes up above? Uh you know, now we're at 30,000, close to 31,000. Where, where do you think the majority of the flows that will happen particularly in the in derivatives but also in the spot markets? Uh where are we going to see it in the next few months? Well, you know, Bitcoin is gonna be boring old grandpa right now in the room with all the chaos, with all the investigations, nobody's talking about Bitcoin having a problem and part of it is it's by its nature, a stable thing, it doesn't change, it doesn't have new upgrades every few months. So there's not really a lot to get excited about if you want to speculate on volatility. However, either a lot of things are happening, the rules of the game have just changed again and this gets people excited about. Maybe there's potentially here to lay a bet. So that's why I think we're seeing more activity on the option side and I expect that to continue. So we're hearing cries of alt season out in the markets. People are getting excited again. I think there's two things kind of going on, right. Sort of these, uh these Ethereum adjacent tokens that are sort of related to liquid staking derivatives are certainly pumping. But I guess the other side of that coin is that maybe the alt L one thesis is looking less and less attractive as Ethereum keeps shipping these major upgrades. What's your view of the impending alt season? And what is your thesis in terms of who might be a winner and who might be a loser going forward? Well, you know, I think people in crypto love a new story and they love a new narrative and that's what Ether keeps giving them. So when they look at these L sds and other new products, that's very exciting. If you remember the 2021 bull run that was driven by a lot of new products, new lending protocols, new ways to concentrate liquidity on decentralized exchanges. And people got excited about it. Same thing with those alternative L ones, but they're kind of old news now. And unfortunately, Solana, which is one of the leaders in that bowl run kind of has the taint now of the FTX problem. So people are looking for something new and that's what they're looking at now, you know, go on, go on please. You're not gonna go all in on Cardo and Solana. No, you know, we're market neutral, we don't go all in on anything. We're just confident in our strategies making whatever is happening. Oh God, I'm not gonna tell you that on the air at least. Ok, we'll talk after. Yeah. Uh but to that point, I mean, I how, how do you think this is going to look like uh over the next few months as well? Again, you know, to, to Zach's Point, uh the L one narratives are, are kind of uh fading away. But are we still going to see these? I, I there's a word I can't use uh on a family friendly program but um uh I don't know, hit coins. Uh are, are, are we, are we going to see these like continue to pop up and, and uh you know, have these sort of things that's over, right? We're done with that or that's just gonna be the result of chain mails, chain emails that I'm gonna get and uh creepy discord and, and uh telegram messages from, from scammers. Well, you know, I think excitement about alt coins comes from different factors in the larger economy and what's happening in crypto. Again, we've seen a bunch of cycles, we look back to the last one. Lots of things are happening. COVID was one of these ones where, uh, people were stuck indoors and they started buying a bunch of coins. This happened as new products were occurring. And so that really led to the next boom. We're not so sure what's gonna happen to bring on the next boom in ALTs. But you know, we have Reuters reporting on Goldman Sachs saying that they don't see a fed rate coming in June anymore. And that's actually good news for crypto. People might get excited about it again and that might be the hot new stuff. They get to you a bunch of scam emails. All right. Speaking of another uh s coin, stable coins, a little less spicy. Sorry guys, you guys had a thesis recently about sort of capital rotating out of stable coins where we saw a lot of this risky craziness that was going on in the markets. A lot of consternation as to whether some of these dollar back stable coins would hold their peg and some of that cap capital, at least you're theorizing seems to have shifted into Bitcoin. Can you unpack that theory a bit and see uh if there's any new data that supports or uh rebuffs it. You know, it's interesting two things happened at once. Number one, we saw the problem with circle occur and number two, we saw the banking crisis. So people who previously had access to fiat dollars might not anymore as Ron was talking about in the earlier segment. That's one big factor. So the other factor is, well, Circle looks a little shaky right now with what happened. Seems fine today, but we don't know what the future holds and then you've got tether the other big player in the room, which Ron also mentioned, which you know, gives some people a bit of nerves. So if you're holding, wanna hold crypto, you wanna hold digital assets and you can no longer put it in a fiat off. What are you gonna do? Well, you're gonna buy the granddaddy, you're gonna buy Bitcoin because that's safe. That's lasted for a long time. Yes, it's volatile, but you can trust it to be there tomorrow and not suddenly de peg 10% like us DC did got you last one. We'll go back to the original S coin of the ES coins, Doge coin in the markets uh seeing some activity recently, which is continued fascination with Elon Musk's love of this thing and also a major tie up between Twitter and E Toro to offer uh trading directly on that social media platform. What's your thought on this latest Little Doge coin run? We've seen it before and it's gonna keep happening. You know, there is a bunch of savvy triggers out there that know there's a clear correlation between Twitter or Elon saying something about Doge and the price mooning and that's exactly what we saw again. He changes the logo from the bird to doze. For a few days. They do this deal with E Toro. People want to make money and they get excited and they see that as a signal that worked in the past and it's working again. Thank you for that measured analysis on Dogecoin. We appreciate you bringing that level of intellectual rigor to something so very silly. All right, that's it. Thanks so much. That was Dexterity Capital's managing partner, Michael Safa.

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